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ORIX Announces First Quarter Net Income Up 61% Year on Year.

TOKYO -- ORIX Corporation (TOKYO:8591) (NYSE:IX), a leading integrated financial services group, today announced results for the first quarter (April 1-June 30) of the fiscal year ending March 31, 2006.

Revenues were up 5% year on year to 212,635 million yen. Although revenues from "real estate sales" decreased year on year, revenues from "direct financing leases," "operating leases," "interest on loans and investment securities," "brokerage commissions and net gains on investment securities," "life insurance premiums and related investment income," "gains on sales of real estate under operating leases" and "other operating revenues" were up compared to the same period of the previous fiscal year.

Expenses were down 5% year on year to 162,909 million yen. Although "interest expense," "costs of operating leases," "other operating expenses," "selling, general and administrative expenses" and "write-downs of securities" increased, "life insurance costs," "costs of real estate sales" and "provision for doubtful receivables and probable loan losses" were down year on year.

Operating income was up 60% to 49,726 million yen, income before income taxes(1) rose 59% to 58,448 million yen thanks in part to the contribution from "equity in net income of affiliates" and "gains on sales of subsidiaries and affiliates," and net income grew 61% to 37,789 million yen with a contribution from "discontinued operations, net of applicable tax effect."
 US$ 2005.4-6 2004.4-6 Change %
----------------------------- --------- ---------- ---------- --------
Total Revenues (Millions of
 yen) 1,922 212,635 202,825 Up 5%
----------------------------- --------- ---------- ---------- --------
Income before Income Taxes(1)
 (Millions of yen) 528 58,448 36,653 Up 59%
----------------------------- --------- ---------- ---------- --------
Net Income (Millions of yen) 342 37,789 23,527 Up 61%
----------------------------- --------- ---------- ---------- --------
Earnings Per Share (Basic)
 (US$/Yen) 3.91 432.08 281.05 Up 54%
----------------------------- --------- ---------- ---------- --------
Earnings Per Share (Diluted)
 (US$/Yen) 3.70 409.74 258.14 Up 59%
----------------------------- --------- ---------- ---------- --------

 US$ 2005.6 2005.3 Change %
----------------------------- --------- ---------- ---------- --------
Shareholders' Equity
 (Millions of yen) 6,912 764,603 727,333 Up 5%
----------------------------- --------- ---------- ---------- --------
Total Assets (Millions of
 yen) 55,914 6,185,171 6,068,953 Up 2%
----------------------------- --------- ---------- ---------- --------
Shareholders' Equity Per
 Share (US$/Yen) 78.93 8,731.00 8,322.96 Up 5%
----------------------------- --------- ---------- ---------- --------

(1) "Income before income taxes" refers to "income before discontinued
 operations and income taxes" in the consolidated statements of

-- U.S. dollar amounts have been calculated at 110.62 Yen to $1.00,
 the approximate exchange rate prevailing at June 30, 2005. Unless
 otherwise stated, all amounts shown are in millions of Japanese
 yen or millions of U.S. dollars, except for per share data, which
 are in single yen or dollars.

Segment profits were down year on year for the "Rental Operations" and "Life Insurance" segments. However, segment profits increased for the "Corporate Financial Services" segment thanks to the expansion of loans to corporate customers. The "Automobile Operations" segment performed steadily due to the expansion of automobile leases. The "Real Estate-Related Finance" segment was up due to the contribution from corporate loans, including non-recourse loans, and the loan servicing operations. The "Real Estate" segment increased as a result of higher "gains on sales of real estate under operating leases" and sales of residential condominiums. The "Other" segment was up due to the contribution from "gains on sales of subsidiaries and affiliates." "The Americas" segment was higher due to the contribution from loans to corporate customers and sales on real estate. Finally, the "Asia, Oceania and Europe" segment was up year on year due to the steady performance of the automobile leasing and corporate lending of a number of companies in the region.

Operating assets were up 1% to 5,171,569 million yen and total assets were up 2% to 6,185,171 million yen on March 31, 2005. Shareholders' equity increased 5% to 764,603 million yen on March 31, 2005 and the shareholders' equity ratio was 12.4% compared to 12.0% at March 31, 2005. ROE (annualized) rose from 16.2% to 20.3% and ROA (annualized) improved from 1.67% to 2.47% compared to the same period of the previous fiscal year.

For the fiscal year ending March 31, 2006, we forecast "revenues" of 880,000 million yen (down 4% compared with the fiscal year ended March 31, 2005), "income before income taxes" of 162,000 million yen (up 5%) and "net income" of 96,000 million yen (up 5%), which is unchanged from the forecasts made on April 26, 2005 in our earnings announcement for the fiscal year ended March 31, 2005.

For details on the first quarter earnings announcement please access "First Quarter Results 2005/6" and "First Quarter Results Supplementary Information 2005/6" from ORIX's website at:

ORIX will also hold a conference call in English on Monday, August 1, 2005 at 9:30 PM (Tokyo)/8:30 AM (EST)/1:30 PM (London)/2:30 PM (Continent) to discuss the earnings announcement. For details on how to participate please access:

About ORIX

ORIX Corporation (TOKYO:8591) (NYSE:IX) is an integrated financial services group based in Tokyo, Japan, providing innovative value-added products and services to both corporate and retail customers. With operations in 24 countries and regions worldwide, ORIX's activities include corporate financial services, such as leases and loans, as well as automobile operations, rental operations, real estate-related finance, real estate, life insurance, and investment banking. For more details, please visit our website at:

These documents may contain forward-looking statements about expected future events and financial results that involve risks and uncertainties. Such statements are based on our current expectations and are subject to uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause such a difference include, but are not limited to, those described under "Risk Factors" in the Company's annual report on Form 20-F filed with the United States Securities and Exchange Commission and those described under "Business Risk" of the securities report (yukashoken houkokusho) filed with the Director of the Kanto Local Finance Bureau.
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Publication:Business Wire
Geographic Code:9JAPA
Date:Jul 29, 2005
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